Devas case: US court directs firm to provide documents of its deals with ISRO’s commercial arm

The US court issued the orders in the wake of foreign investors in Devas Multimedia seeking to locate the assets of Antrix Corporation, to enforce a $ 1.2 billion compensation award.

A US federal court has directed an American space launch services firm, Spaceflight Inc, to provide documents for its transactions with the Indian Space Research Organisation’s (ISRO) new commercial arm, NewSpace India Limited, irrespective of confidentiality agreements.

The US federal court for the western district of Washington issued the orders on Monday in the wake of foreign investors in the Bengaluru-based start-up, Devas Multimedia, seeking to locate the assets of an older ISRO commercial arm, Antrix Corporation, to enforce a $ 1.2 billion compensation award. The award was made by an international tribunal over a failed 2005 Devas-Antrix satellite deal.

The US federal court has said that Spaceflight Inc should “produce documents pursuant to agreed-upon requests for production served pursuant to a subpoena, notwithstanding Spaceflight, Inc.’s confidentiality provisions with NewSpace India Ltd.”

Last month, Spaceflight Inc had approached the US court to be identified as an “interested party’” in a court-approved move by Devas Multimedia’s Mauritius investors to identify the assets of Antrix Corporation.

Spaceflight Inc uses ISRO rockets, among others, to provide launch services for global clients. The firm signed up in 2019 to be the first user of ISRO’s Small Satellite Launch Vehicle (SSLV), which is still under development. It also facilitated the launch of Brazil’s first satellite in February on the Polar Satellite Launch Vehicle (PSLV).

In its order on August 16, 2021, the US federal court stated that Devas investors can look at Antrix Corporation’s “relationships with the Government of India and NewSpace”.

Three foreign investors in Devas Multimedia – – CC/Devas Mauritius, Telcom Devas Mauritius and Devas Employees Mauritius Pvt Ltd – have argued in the US courts that NewSpace India Limited has been created by using assets that belong to Antrix Corp.

Among the things the US court has allowed foreign investors in Devas Multimedia to access for recovery of compensation is “all documents and communications” on transactions valued at more than $ 50,000 from Antrix Corporation to NSIL. Antrix, meanwhile, had argued in the US court that both Government of India and NSIL enjoy “foreign sovereign immunity”.

The $ 1.2 billion compensation award to Devas Multimedia was made on September 14, 2015 by an ICC tribunal following cancellation in February 2011, by the Indian government, of a January 2005 Devas Multimedia- Antrix deal. The compensation award was confirmed by the US court for the western district of Washington on October 27, 2020.

Under the 2005 deal, ISRO was supposed to lease two communication satellites for 12 years at a cost of Rs 167 crore to Devas Multimedia. The start-up firm was to provide multimedia services to mobile platforms in India using the space band or S-band spectrum transponders on ISRO’s GSAT 6 and 6A satellites.

The deal was annulled by the UPA government in February 2011 amid the 2G scam crisis by citing the requirement of the S-band spectrum for security needs of the country. After the NDA government came to power in 2014, the CBI and ED were asked to investigate the deal.

After the cancellation of the deal, foreign investors in Devas Multimedia – the Deutsche Telekom, three Mauritius based foreign investors — and Devas Multimedia approached various international tribunals seeking compensation.

While Deutsche Telekom was awarded a compensation of $ 101 million plus interest by the Permanent Court of Arbitration in Geneva on May 27, 2020, the Mauritius investors were awarded a $ 111 million compensation (plus interest) by the United Nations Commission on International Trade Law tribunal on October 13, 2020 and Devas Multimedia was awarded a compensation of $ 1.2 billion by an ICC tribunal on September 14, 2015.

Antrix Corporation appealed against this order in a US court. In a November 2020 order, the Supreme Court of India asked for the ICC award to be kept in abeyance.

The National Company Law Tribunal in India ordered the liquidation of Devas Multimedia on May 25, 2021, following a plea by Antrix Corporation.

Source: Read Full Article